SunCulture Annual Letter 2019

Dear SunCulture Supporters, 

As you read these words, food insecurity is peaking in the Horn of Africa. Across Ethiopia, Kenya, and Somalia, farmers have suffered two years of poor rainy seasons and depressed crop yields. One of our customers, Ruth, told us that she spent last year waiting for the rain to fall, while watching her crops dry up. This story is too common among the 96 percent of smallholder farmers in Sub-Saharan Africa who rely on rain-fed agriculture. 

It doesn’t have to be this way. At SunCulture, we’ve seen that getting the right technology into the hands of smallholder farmers empowers them to take control of their environments. Since getting a SunCulture system in January, Ruth can access all the water she needs. She’s growing more crops for her family and to sell to the market, including peas, cabbage, and kale. When we asked her how irrigation has impacted her life, she said, “I can farm without fear.”

These stories are at the heart of what we do. 

And we’re thrilled to see more and more stakeholders share our conviction that agriculture technology (“AgTech”) is at the core of unlocking smallholder productivity, resilience, and incomes. Investors put US$16.9 billion in global AgTech companies in 2018, a 43 percent year-over-year increase. The concept of “productive use energy” has taken off as a way to think about how we can use access to energy to drive income-generating activities, particularly for the rural poor, who are least likely to be connected to the grid. All the while, there has been an incredible rise in the number of organizations investing time, energy, and resources into learning how to scale solar irrigation in Africa.

Today, I’d like to add to this exciting conversation by sharing SunCulture’s biggest technology developments this year, as well as some thoughts on how to catalyze the mass uptake of these technologies for the benefit of smallholder farmers everywhere.

Making AgTech stronger, better, faster

Our Research and Development team had an incredible year. We launched two award-winning products, RainMaker2 with ClimateSmart Battery? and ClimateSmart Direct?. In a competition among the best-in-class products in our space and the largest pump companies in the world, we were recognized by the Global LEAP Awards as having the world’s best off-grid solar water pumps in two categories. 

Here’s what helped us stand out among the impressive crowd: one of the best features of RainMaker2 with ClimateSmart Battery? (as you might’ve guessed from the name) is the battery. Energy storage means that the pumps can run on a cloudy day or during the night. It also means that a single system gives farmers the ability to power both appliances that improve quality of life in the household (such as lights and phone chargers) and appliances that generate income for agriculture (such as water pumps for irrigation or TVs loaded with episodes of the agriculture training show Shamba Shape Up). 

“RainMaker2 provides light, with no black out and no charges” said our customer, David. “It is easier to get water, and I can irrigate the way I want. I have expanded two acres. I can sell products at higher prices during dry season. I can now leave the pump and come back. It works by itself.”

That said, we also heard from many farmers who didn’t need, or didn’t have the resources for, the energy storage component. They asked if we could make a simplified product that would be laser-focused on pumping water for irrigation. And you know we’re all about that customer-centered design. So last month, we launched ClimateSmart Direct?, which makes high-quality irrigation equipment accessible for a lower income bracket. It is optimized for battery-free operation and comes with our standard suite of Internet of Things (“IoT”) capabilities, like remote monitoring, predictive maintenance, and precision agriculture (e.g., irrigation recommendations based on weather forecasts), so our customers get the most out of their systems at every moment.

Scaling can’t wait 

There are 500 million smallholder farming households who make up a significant portion of the world’s poor and extreme poor. Helping smallholder farmers climb the productivity ladder would lift an entire class of people out of poverty, while driving economic growth in emerging markets through sustainable agriculture. It’s estimated that irrigation expansion in Sub-Saharan Africa, where agriculture employs over half the population, would generate $14 billion - $22 billion a year. 

Smallholder farmers are also on the frontlines of the fight against food insecurity. The world must produce 70% more food by 2050 to feed a population that will reach nearly 10 billion people. At the same time, climate change is making rain-fed agriculture more and more precarious, depressing yields for core staples like maize, wheat, rice, and potatoes. Without additional investment in irrigation, 300 million people could be at risk of hunger in Africa. That’s about the population of the United States today.

Feeding the world without exacerbating climate change will require transforming the global food system. One of the most shocking statistics I’ve read this year is that the hidden environmental, health, and poverty costs of the way we currently grow food actually exceed the market value generated along the entire value chain. We need to do better. The key to a more resilient, sustainable future is productivity -- simply increasing yields on the land we already use for agriculture would more than double Africa’s current food production. 

Big moves for big scale

If we’re going to harness the power of smallholder farmers to increase economic prosperity, food security, and climate resilience, we need to drastically expand the reach of productive use technologies. 

To do this, we need the public sector to join forces with private sector innovators like ourselves. We’ve seen encouraging signs that governments, multilaterals, and donors are starting to recognize the importance of accelerating the uptake of solar irrigation: 

•  The Alliance for a Green Revolution in Africa (AGRA) has committed to promoting irrigation technology for smallholder farmers, with US$9 billion pledged from the World Bank to support African governments in irrigation improvements.
• In March, Togo became the first government in Africa to introduce a subsidy program for solar energy payments, which will enable solar home systems to electrify more than 300,000 households. This is a hugely promising model for a public-private partnership that could be adapted for solar irrigation.
• In May, the Ethiopian government approved tax-free imports of all agricultural technologies. This builds upon a bold set of actions that Ethiopia has already undertaken with the explicit aim of speeding up irrigation expansion, including mapping groundwater resources, funding small-scale irrigation projects, and introducing mass government tenders for irrigation equipment. We’re incredibly excited about working with our partners in the Smallholder Solar Pump Alliance in Ethiopia and are energized about how the government is embracing technology.

Amazing things happen with the right kinds of partnerships. In the span of a decade, Ethiopia increased the amount of irrigated land in the country by 52 percent, Kenya by 37 percent, and Niger by 20 percent. The share of arable land under irrigation is still tiny -- 5 percent in Ethiopia, 10 percent in Kenya, and 2 percent in Niger -- but we’ve seen that public sector commitment and supportive policies can rapidly drive uptake and accessibility. Now we need more governments to get in the game.

Thank you

Charlie and I are deeply grateful for the partners, mentors, colleagues, friends, and family who have shared our passion for transforming the future of smallholder agriculture. 

It is because of all of you that we have come this far.

There is much more work to do. Let’s get a move on!

Samir Ibrahim

CEO

November 6, 2019